This is just a fundamental difference in investing styles. To say that a company is overvalued is to say you know what a company’s value is based on their future endeavors, so what is a fair value of it? You can definitely cite some “widely accepted metric” but it just doesn’t work for technology companies. The reality is that no one, especially us, know none these things. First rule in investing NKA, nobody knows anything.

To me, the internal combustion engine and fossil fuels are soon to be a footnote in history. As will auto manufactures as we know it. Some will remain in name only. No one is anywhere near Tesla in technological advancements. It’s a $650 billion company based on
market cap; you are saying it can’t or SHOULDNT be worth more than that. Why?

PE on a high growth company is useless; if a company is focused on growth there should be no “E” in PE as all of their money should be reinvested to pay for that growth. This is just one example of why traditional metrics don’t work on companies like Tesla.

I’ve heard these arguments many times for various companies; AMZN who was just a book seller, made no money, cash burn through the roof etc. Who would have thought they’d be what they are today?

Amazon, the online book retailer?
Apple, the Mac computer company?
Adobe the photo shop company?
Disney the theme park company?
Google the search engine company?
PayPal the eBay payment company?

Who would have thought these companies would have morphed into what they are today.

I do not dispute that highly valued companies don’t have a violent reaction to market movements and news; I live it several times a year. Hell I’ve lost more than 1/2 a years salary in one day. The point is if you continue to buy and hold, you reach a point where the chances of you giving all of that back are virtually nil. Time is the most valuable asset when investing. The possibility remains, but it’s remote.

Here’s the thing, I love that there are two sides to these investment theories; that’s what makes a market and that’s what has gotten to me to where I, financially speaking.

I thoroughly enjoy these discussions!